It's week 4 and we're continuing to share what we learned from London 2016 forum breakouts. This week, it's about the challenges of managing your money while starting up your own business.
Andrea Sommer of Hiver & Sarah Haque of Urban Species led this year's breakout session on "Taking the Financial Risk to Starting Your Own Business".
Taking the Financial Risk to Starting Your Own Business
Start with support: Look into local business startup groups (including local councils and libraries) for business guidance, legal advice and mentorship. There's a lot of free resources out there to help you get started without having to "reinvent the wheel" from scratch. If you have investors, utilise their experience and connections to further your business. Leverage your network and talk to as many people as possible for insight. This is your potential customer/employee/investor base, and you’d be surprised who comes out of the woodwork to be able to help.
Seek (whenever possible free) professional advice : Many business owners say that their accountant is the most important adviser they have. The services of a professional adviser can be invaluable and can make the difference between success and failure in understanding how to manage the bloodline of your new business: cashflow! As you go through the interview process of finding the right adviser, extract as much free advice as you can to set your business up right.
Maximise your credit: Get your personal credit score as high as possible, take out equity in your home, increase your bank overdraft and credit card limits all while you’re still earning a salary (i.e. before quitting a job to start a business). As with any type of a career break, getting credit will be much more difficult if you don't have a steady stream of income.
Think about the end game: How you exit a business can be just as important as how you start a business. What are your end goals and aspirations? You need to operate your business with the mindset that you may potentially sell the business. If so, what are the actual valuable part of your business that will be attractive to buyers? Physical Assets? Market Data? Websites and other technology? Also watch for the 4 D’s: Death, Disability, Divorce, Departure. How are you protected?
What are your thoughts? What advice can you share from your experiences preparing for your life's major financial moments? Please share your thoughts with us on Facebook here.